Beavertown

British Backlash: Beavertown Sells Minority Stake to Heineken

While most American beer consumers probably haven’t heard of the British craft brewery, Beavertown, it’s a beloved brand across the pond. It was, at least, until the predictable backlash started after a recent announcement by founder and CEO, Logan Plant. Plant is the son of Robert Plant of Led Zepplin fame and his brewery, Beavertown, has seen incredible growth in the 6 years. The brewery also puts on a craft beer fest with a brewery list that is half-filled with American craft brewery darlings like Monkish, Trillium, Treehouse, Alesmith, Modern Times and Three Floyds to name a few. Plant even gave a memorable and rousing speech at last years Beavertown Extravaganza lambasting big beer. “The puppet master that is Big Beer is stirring and starting to swipe its tentacles far and wide across this beer industry,” He told the crowd at BeaverEx17, according to one Facebook poster.

Yesterday, it was announced that Beavertown was going to grab ahold of one of those tentacles by selling a minority stake in their company to Heineken. They declined to announce the percentage of the stake, but it’s pretty safe to assume it’s beyond the 25% that American Brewers Association set as the limit of non-craft brewery ownership. Otherwise, they wouldn’t keep it a secret. It could be as much as 49% much like the 50% that Heineken bought of Lagunitas a few years back before eventually buying 100% of Lagunitas. While Plant and Beavertown tried to get out in front of the story by posting a Q&A and a blog post, many people were, unsurprisingly, bitter about the new partnership on social media.

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Funkatorium All Over Again

Perhaps some of the most upset people were ones that had already purchased tickets to Beavertown’s lauded Beavertown Extravaganza.

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Filled with U.S. and U.K. craft breweries this festival always promoted the independent brewer and the 2017 fest was when Plant made a speech about the evils of Big Beer. With the announcement of the partnership with Heineken, some of the craft breweries have already pulled out including, Brewdog, Treehouse, Cloudwater and Veil Brewing. When people asked for their money back they were told no but to hold on, Beavertown was still assessing the situation.

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When Wicked Weed sold to AB InBev last year they too also ran a successful festival called the Funkatorium Invitational known for getting some of the top breweries in the country. When they sold, so many breweries pulled out of their festival that they canceled it and haven’t resurrected it in 2018. Not that a brew fest will get in the way of the millions of dollars that both breweries have now that they are in bed with big beer but it does leave a lot of bitter fans.

In His Own Words

The Q&A with Plant is an interesting read, mostly because his unabashed ambition is clear in the post. When asked why he picked Heineken he said, “This is about ambition. I am driven to take myself, our team and the brewery to new levels.” Crystal clear.

Apparently, Plant’s idea was always to open one of the largest craft brewery operations in the U.K. called Beaverworld. Beaverworld will give them the ability to brew ten times the amount they brew now on a fully automated brew system. He states, “We are now going to build one of the grandest platforms to shout loud and proud from. I want Beaverworld to be one of the world’s best brewery experiences both from a technical standpoint and as a visitor experience.”

When asked if it was hypocritical of him to partner with big beer after being critical of them he says, “Yes, during the Symposium at BeaverEx17 I criticised some aspects of what big brewers do and I recognise that some people will not be happy with my decision to take investment from one. I didn’t take the decision lightly.”

He further spoke of his admiration of Heineken and why he picked them. “The culture and values across their team are heralded and I take inspiration from the great journeys their team members have been on, progression through their company is amazing and something we have always tried to promote at Beavertown. So, we share many values, both cultural and brand specific, with them.”

What’s interesting about this is that while Heineken may have a good reputation from their team members, they don’t have a great reputation in other areas. A recent case study on Heineken was released called Heineken in Africa, which outlines a company with quite questionable values:

Heineken in Africa is the result of three years of thorough research, not only in the eleven African countries where Heineken has its own breweries and joint ventures but also in the company’s archives and literature. The author has spoken to almost 300 sources within and around the company.

The book has revealed many controversial facts and practices that made headlines in the Netherlands. It shows how Heineken collaborates with dictators, authoritarian governments and an alleged war criminal, how it’s using a mysterious Belgian operating company for tax avoidance in African countries and that the company is tied to human rights violations and high-level corruption. 

All of this paints a picture of a company bent on ambition, ripe for selling to a bigger brewer. It’s clear from his own words that his ambition was to grow far and grow fast and realistically that’s hard to do without the deep pockets of big beer. While many UK craft beer drinkers are upset because this doesn’t align with their values, it certainly seems to align with the values of Plant.

Maybe that’s something for consumers to remember when their beloved brand sells to big beer. While everyone has their own perception a brewery that they support, that perception might not be shared in the goals of the brewery itself. Furthermore, that brewery/owner might be paying you lip service, much like Plant did at last year’s BeaverEx17. He was playing the craft beer game until it suited him to level up. Likely, this injection of $55 Million will shoot their production and availability through the roof in their quest to be on every corner. Just be wary the next time a brewery lays their ambitions so nakedly at your feet. When the single quest is the ambition to grow as fast and wide as they can, the writing may already be on the wall.

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Craft Beer Trends to Kick Off the Summer

Recently, DSM, a health and wellness company, conducted a study of more than 3,300 beer consumers from 7 different countries in North America and Europe and asked them questions about craft beer. While statistics and studies need to be taken with a grain of salt, they can help identify broader trends in a market, including craft beer consumption. One factor of this study to take into account is that it’s a world-wide study vs. one with only U.S. participants. While the craft beer scene here in the States has been booming for some time (and many publications have lamented that the craft beer bubble is bursting) in other places where people were surveyed, the craft beer movement is in its younger stages. That’s not to discount the findings at all, it’s just something to keep in mind as we look for trends or insights from the study.

It’s All About The Taste

Not only do 66% of the responders drink craft beer because of the taste, it also seemed to be the biggest reason why people in this study choose a specific craft beer. In fact, 75% chose taste as the biggest factor when deciding which beer to buy. What’s interesting about this is that taste won out over price, which shows that craft beer consumers are not afraid to pay a premium for good beer. This is also good news for smaller craft breweries that have to compete with larger breweries when it comes to marketing and branding. Yes, people like a catchy graphic, but it’s not a driving force into which beers people buy. Make a quality product that tastes great and you have the best chance that someone will choose that beer again. Furthermore, 66% said that the word “premium” helped draw them to a specific beer and that drinking craft beer felt more special than drinking non-craft beer. We love making people feel special, one beer at a time.

You Are Only As Good As Your Last Beer

It’s no secret that craft beer drinkers are adventurous. So adventurous, in fact, that one of the more interesting findings from this study was there isn’t a whole lot of brand loyalty with this group of craft beer consumers. 80% said that they would continue to experiment with new brands vs. stay loyal to one brand. This is a concerning statistic when thinking about building a brand, but also one that makes sense. People won’t blindly buy beer from a brand that isn’t stellar just because they are their local brewery or because they had a good beer in the past. What this tells us, is that as brewers we need to keep quality, tasty beer our number one priority and we need to keep things fresh for consumers. We can’t be afraid to experiment with new styles and flavors and pushing the proverbial envelope. We need to keep evolving and not rest on a set of core beers, because although we will always have our super-fans, to continue growing, we need to stay relevant with the adventurous consumer.

The Definition of Craft Beer Is Fluid

While the buzzwords “local” and “craft” are still market drivers, it wasn’t for the exact reasons you would expect. 87% of responders said that they define craft beer as beer brewed in small batches by a microbrewery. No mention of if the local beer was brewed in close proximity to them and no mention of independent vs. non-independent, which is not surprising. Sometimes we in the industry can get caught up in our own echo-chambers of what’s important and what people care about. I personally, care about whether my beer is independent and know a lot of others that feel the same way, but we have to remember that by-and-large, people make up their own definitions for things. So while the study found that people prized “local” beers, it was not because they were necessarily brewed close to home, but because to them, the word signified that the beer is made in small batches, using local, fresh ingredients. Furthermore, a majority of responders expressed interest in trying local craft beers from around the world further driving the point that people are more interested in what characteristics they felt a local beer would have vs. being loyal to a local brand because it was brewed in their backyard. This is good news for breweries breaking into new distribution areas. That while many craft beer consumers will still drink what local first because it has a good chance of being the freshest, other characteristics of craft beer area driving factor in which beers people choose to drink.

In the end, while these studies can be helpful in understanding trends and consumers in a broad way, there are many factors that go into why people buy the beer that they buy. However, it does give us things to think about and we can all revel in the finding that people are continuing to drink craft beer with 80% of the responders saying that craft beer is not just a delicious fad, craft beer is here to stay.